PancakeSwap's New Auto Position Manager

By idiosyncratic | Idiosyncratic Crypto | 16 Nov 2023


The decentralized finance ( DeFi ) on blockchains has been a new type of source of income thanks to their technology-based transparent operations. The DeFi ecosystem has evolved faster when the v3 of liquidity pools was introduced.

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Though Concentrated pools ( also known as v3 pools) enable the liquidity provider to decide on the most suitable price range, the fee tier and the positions, there is a groundbreaking new product on the market: Single Asset Staking.

Single Asset Staking may sound like "staking" solely your own token but the working mechanism are rewards are very different from the staking features. While the staking maximum offers 5% - 10% for you to lock your crypto, the single asset staking utilizes a small portion of your total capital to buy some pair coins to form liquidity pools.

What is Position Manager on PancakeSwap?

Basically, a new type of smart contract that lets investors test very high APR for their rather limited risks.

When users leverage into their v3 positions on PancakeSwap through Diamond Factory, they borrow the tokens from Diamond Protocol's Pool and lock the assets on PancakeSwap, facilitating seamless liquidity provisioning. Borrowers incur interest when they borrow tokens, and the interest yield is paid to users who provided liquidity in Diamond Protocol’s pool.

In the blog of PancakeSwap, we can see the summary by PancakeSwap to inform new DeFi investors.

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I provided $8.51 worth of USDT liquidity to USDT - CAKE single token pool on PancakeSwap. This farm directly interacts with BRIL and the other DeFi pools as a Market Maker algorithm to bring the best ratio rate for each trade in the background.

In my example, my whole USDT investment was divided into a big chunk of USDT and a limited amount of the pair ( CAKE in this example ).

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The single token pools are getting more popular and the rewards on them are pretty satisfactory so far. The APR of the majority of the pools exceeds 100% as the liquidity is quite limited.

Finally, if you go to the website of Diamond Protocol, you will see the liquidity pools that offer single token liquid staking, as well. This is an amazing product that will motivate investors to keep their money in crypto while earning nice on their job.

 

The hype on PancakeSwap was not well understood in the first day but now people realize the story behind. The leveraged gains enable crypto holders to stake via single assets LPs and enjoy the rewards of the protocol as it is ready to distribute.

Remember **Each liquidity provider on PancakeSwap pushes protocol to buy more Pancake tokens ( 25% of the total ) so that the system can be preserved and funds can be used actively on the side of Diamond Protocol. I have started testing the protocol and I think we will see something great because it has been actively ongoing for a long time. Of couse low capital does not even compensate the amount of fee being paid in every single transaction it is always better to be on a protocol with at least %1500 so that it becomes worthy it. I'll share the details of the test on threads!

What do you think about the new feature of single asset staking on Pancake? Share your thoughts and experience below 👇

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